El Dorado City Commission discusses compromise on water

Alternatives to the proposed 10 percent rate increase for larger water users was discussed during a special meeting Tuesday afternoon.

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By Julie Clements

Butler County Times Gazette

By Julie Clements

Posted Nov. 27, 2013 at 8:15 AM

By Julie Clements
Posted Nov. 27, 2013 at 8:15 AM

El Dorado

The El Dorado City Commission discussed alternatives to the proposed 10 percent rate increase for larger water users during a special meeting Tuesday afternoon.

“The message I heard is there was some angst, some willingness to look at continuing the two-tier rate for a while so we began looking at the way it was structured,” said Kurt Bookout, public utilities director. “We went back and looked at how can we keep the two-tier system and still meet our goals.”

Bookout said they were recommending a 2 percent increase for the first tier for in-town residents, while larger users in town and rural water districts would raise 6 percent. He also provided them with numbers for 5 and 7 percent increases for large users.

The goal was to move the two tiers closer together so if the city ever decided to go to one tier, or the state required it, it would not be such a change.

“We focused on tier two plus 6 percent because we thought it was a good compromise and generated the amount of revenue we need,” he said.

What this means for customers is for those who use the average of 7,500 a month, there would be a 22 cent increase in the city limits and $1.20 for rural water users.

Bookout said the projected revenue was about $180,000 a year.

Bookout went on to talk about what they would use the money for, presenting the commission with a seven-year project list for infrastructure repairs and replacement, maintenance and some multi-year projects. They totaled $2.6 million plus the annual expenses. The $150,000 annual cost is for maintenance, Bookout said, just keeping up with the leaks, as well as some additional annual costs.

“The rest of these are important projects,” he said. “I think we have been making great strides.”

He said since 2005 they have been increasing their efforts to keep up with the deterioration in the water distribution system.

“We will have to pick and choose projects that are the most important,” Bookout said of this new increase. “This is the wish list. A lot of these items are pay me now or pay me later. You let things go too long and it is sometimes not a simple fix. We are not going to generate enough revenue to do all the projects on here.”

Some of the reasons for the need for more funding included increasing costs, such as fuel.

Commissioner David Chapin asked how Bookout got to the $1.20 number for rural water customers.

Bookout said that was the amount the city would raise the cost to the rural water district, but they have no control over what the water district charges.

One water district representative in the audience said because they are a wholesale distributor they would have to raise that cost even more for their customers in order to balance their books.

Page 2 of 2 - Bookout also presented the commission with a projected rate increase for the city of Wichita. He said it did not affect the decision they had to make, but it was good to know what others were doing. Wichita has raised rates 11 times in the last 12 years.

“Does this alternative give you the money you need to continue keeping up with your repairs and anything you’ve done in the past?” asked Commissioner Nick Badwey.

Bookout said it would be enough for four to five years.

“I appreciate this,” Commissioner Chase Locke said of the new information. “Having learned more myself over the past week, I also appreciate that breakdown on what we are spending money on. If we can gradually do this where the rural water district and folks out there can have somewhat of a heads up, I feel better, so we don’t put that immediate burden on them. To me this looks better than what we were looking at.”

Commissioner Bill Young also was glad to see the new recommendation.

“I like this vision better than the vision we saw the other night,” he said. “If we are able to minimize that impact and give kind of an expectation of what might or might not happen with their rates moving forward it makes it easier to plan.”

Mayor Mike Fagg then asked about water contracts, saying he had never seen one.

Bookout said they do have them and some are 20 years and some are for 40 years. Bookout has seen some agreements where the mayor and city manager signed them, although they were not brought before the commission. Rather, they were negotiated by the city manager. He has only seen one be renewed while he has been with the city.

Chapin also asked how long rural water districts would need to change their rate charts to reflect the new rates, and he was told about 30 days.

Chapin went on to ask about a rate increase on raw water.

“We’re going to be talking about that, too,” Bookout said.

Fagg asked Bookout to get a copy of the information he had provided them to the rural water districts. An ordinance will be created before the commission’s first meeting in December so they can vote on it. If approved, the new rate would go into affect Jan. 1 and customers would receive the first bill in February.

In addition to discussing water, the commission also reviewed applications for board appointments. They still have one spot on the Convention and Tourism Committee open. They will appoint the new members at their next meeting.